Like the News of the World Phone-Hacking Scandal Before It, The Sun's Payoff Probe Is Snowballing Out of Control

When the phone-hacking scandal at Britian's News of the World began to snowball out of control last summer, Rupert Murdoch, the chairman/CEO of News Corp., acted with brutal swiftness. He euthanized the 168-year-old tabloid with just a few days' warning. At the time, I wrote: "Facing a major meltdown, News Corp. is doing its best at containment. The problem is that it may be too little, too late. And it's glaringly inept, too -- on par with Tokyo Electric Power Co.'s attempt at containing the fallout at the Fukushima nuclear reactor. Also: There's a hell of a lot of radioactivity to News Corp. beyond just News of the World."

The media frenzy surrounding Whitney Houston's death on Saturday has overshadowed the latest drama at News Corp. In typical understated fashion, Murdoch archnemesis The New York Times ran a piece yesterday with the flaccid headline "Hacking Cases Focus on Memo to a Murdoch" (though it did at least give the story a page-one placement). Reported by Sarah Lyall and Ravi Somaiya, it is worth reading in full.

But here's the executive summary: On Saturday , five key editors and reporters at News Corp.'s Sun tabloid were arrested on suspicion of corruption, caught up in an investigation into payoffs to public officials, including police. If that weren't ugly enough, the investigation has helped draw fresh attention to the fact that Rupert's younger son James, chairman-CEO of News Corp. in Europe and Asia (and thus the boss of News Corp.'s British newspaper division, News International), was sent an email in 2008 by a deputy that contained, as the Times put it, "explosive information" about the scope of the phone-hacking scandal. (James Murdoch has generally maintained that he had no idea that the phone hacking was as widespread as it was.)

Guess what? One copy (the one that should have been in James Murdoch's email archive) was conveniently deleted from News Corp.'s servers during what the company (hilariously) called an "email stabilization and modernization program," while another copy (the one belonging to its sender, Colin Myler, former News of the World editor) was supposedly lost because of a "hardware failure." Inconveniently, investigators recently discovered a printout of the email.

Since we now know this email exists and was in fact sent to James Murdoch, what's his excuse for not acting on it? You really have to read the dry Times account to appreciate the extent to which the assorted News Corp. scandals have metastasized into farce. James' response is not too far off from "The dog ate my homework."

Another must-read: This blog post from Roy Greenslade at The Guardian, the British paper that has doggedly pursued the News Corp. corruption story in all its forms. Greenslade deconstructs other newspapers' coverage of "the civil war at The Sun," including an editorial today in The Sun itself, by Associate Editor Trevor Kavanagh, titled "Witch hunt has put us behind ex-Soviet states on press freedom." Greenslade's reading of Kavanagh's rant: "His overt message is an attack on the police. But the covert message is more significant [and] amounts to a thinly veiled attack on The Sun's owner, Rupert Murdoch."

Greenslade also quotes an anonymous News executive who pops up in a piece over at the Daily Mirror: "We are being destroyed from within. As we saw with News of The World, there is nothing the Murdochs will not do to protect their own backs."

Last year's shuttering of News of the World -- and the implicit message that Rupert Murdoch felt he could surgically excise an isolated cancer and be done with it -- now seems like the ultimate folly. It made the rank-and-file feel disposable and betrayed. And, arguably, more likely to cooperate with authorities.

The term that 's appearing everywhere in the coverage of News Corp. is "cover-up," thanks to the very curious manner in which News Corp. has handled its email archives while under investigation. As the Times notes, British High Court Judge Geoffrey Vos has said that News Group Newspapers, a division of News International, is "to be treated as deliberate destroyers of evidence."

News of the World, shut down with such astonishing speed by the Murdochs, now looks like nothing so much as a repository of evidence that needed to be destroyed. The Sun suddenly looks like another such repository. This time, though, it won't be as simple as just dumping the body in the Thames.

Simon Dumenco is the "Media Guy" columnist for Advertising Age. You can follow him on Twitter @simondumenco.